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14 Common Credit Mistakes
Establishing credit and wisely managing your credit becomes easier when you know how. You'll feel empowered by taking knowledgeable steps towards good credit, and you'll be on your way to purchasing real estate and greater financial freedom. If you plan to finance real estate, either as a home buyer or an investor, avoiding these common credit mistakes will help you with your credit score and save you money in loan costs. 14 Common Credit Mistakes 1. Using expensive or undesirable types of credit costs too much and is negatively scored. 2. Accumulating too many lines of credit or too many credit cards causes credit report remarks like "too much consumer credit." 3. Only paying the minimum due keeps balances too high. 4. Being maxed out on any credit card or line of credit causes deep drops in scores. 5. Taking cash advances costs higher interest and extra fees. 6. Exceeding limit and having to pay over-limit fees is a negative with creditors and causes "high proportional amounts owed" remarks on credit reports and subtracts credit score points. 7. Paying a day or more late causes unnecessary late fees and often increases interest rates. 8. Charging more than you can afford causes a snowball effect of amassing debt with no easy way to pay it off. 9. Letting someone else use your credit, such as co-signing a loan, raises your debt-to-income ratio and possibly adds "too many consumer accounts" on your credit report, which lowers your score. 10. Ignoring credit problems causes unnecessary negative impact. Talk to creditors before being late and make arrangements. This action heads off negative reporting to credit bureaus. 11. Failure to report address changes to creditors causes misplaced bills and late payments. 12. Using partial name, different names, initials instead of whole name, or forgetting Sr. or Jr. causes mix-ups. Use your full legal name to protect you from confusion with similarly named borrowers. 13. Failure to report name changes to creditors also causes confusion. 14. Not checking credit report frequently is one of the most common mistakes consumers make. You can buy real estate with poor credit, but you will save thousands in loan costs if you maintain good credit. A bad credit report leaves home buyers with sub-prime loans which have higher point charges, prepayment penalties, and higher interest charges, which therefore cost more money. For instance, a mortgage loan of $150,000, 30-year, fixed interest rate of about 5.72 percent costs around $870 a month. Poor credit scores raise the interest rate over 9 percent and the payments over $1,200. As you see from these payment differences, good credit means that you can finance a more expensive house with the same income, or save $330 each month. Credit Requirements for Mortgages Credit needed to buy real estate is not the same as good credit. Besides your credit score, mortgage lenders consider your debt-to-income ratio and other credit matters, unlike other credit grantors. Your debt-to-income ratio is the comparison of mortgage payment, including taxes, interest, and insurance to your total gross monthly income. Real estate lenders also consider your employment qualifications and your overall debt ratios. Understanding the difference between good credit and the credit needed to obtain real estate financing helps you buy houses! Avoiding credit mistakes helps you get strong credit and keeps your credit scores up. (c) Copyright 2005 Jeanette J. Fisher. All rights reserved. Professor Jeanette Fisher is the author of "Credit Help! Get the Credit You Need to Buy Real Estate," "Doghouse to Dollhouse for Dollars: Using Design Psychology to Increase Real Estate Profits," and other books. Jeanette and her husband chose real estate investing to be able to care for their daughter with special needs. While buying and selling millions of dollars worth of real estate, the Fishers were forced into becoming credit experts. Forget what you've been told about credit. Get the credit you need to buy real estate. Real Estate Credit Help Center: http://RE Credit Help.com/ MORE RESOURCES:
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GOOGLE SEARCH Useful Tips on Borrowing Money Here are some useful tips on borrowing money. Borrowing money is one of the most common sources of funding for a small business, but obtaining a loan isn't always easy. Different Ways to Borrow Money There are many different ways to borrow money. Outlined below is a useful guide to some of most common ways of borrowing money. Can You Acquire Good Credit Overnight? You Bet Your credit file may not reflect all your credit accounts. Although most national department store and all-purpose bank credit card accounts will be included in your file, not all creditors supply information to credit bureaus : Some travel, entertainment, gasoline card companies, local retailers, and credit unions are among those creditors that don't. 10 Dirty Tricks Credit Card Companies Play The credit card companies make billions each year in legitimate interest charges and fees, but are under constant pressure from the shareholders to increase their earnings. To make this extra money the credit card companies sometime adopt some dirty tricks to make this money. Credit Verus Debt Secured and unsecured debt - what's the difference?It's easy to just think that debt is just debt, but in reality,there are different types of loans, and it's important toknow what which type you have.You will need to understand the differences in order tobe a good money manager, or, if the worse happensand you find yourself turning to credit or debt counseling,you'll need to understand how different types of debtcan be handled. Choosing the Best Low Interest Credit Card With so many low interest credit cards on offer, how do you know which one to choose? Here is a brief guide for choosing your low interest credit card.The Chase Manhattan MasterCard is a great choice, for those with an excellent credit rating. Free Credit Reports Now Available From the FTC The Federal Trade Commission (FTC) has set up a new website (www.AnnualCreditReport. Credit Cards Credit cards are a form of unsecured credit. The issuer isextending you a line of credit, usually tacking on all sortsof little surprises in the fine print. It Takes Credit To Build Credit Using a credit card wisely is an important step in building a good credit rating. If you're trying to re-build your credit or if you're young and just starting out, pay close attention the next time you receive a new card offer in the mail. All About Balance Transfers What is a balance transfer?A balance transfer can be explained simply as a balance transfer! When a balance is transferred usually from a credit card, but possible from a bank account or loan to a credit card with a offer interest rate (usually 0%) for a set period. It does not have to be the entire amount. Simplifying Your Search For a New Credit Card Today, selecting the proper credit card can be a bit confusing to say the least. There are literally hundreds of offers from the major institutions eagerly competing for your business. Manage Your Credit Wisely Getting your first credit card is a big deal and all young people look forward to it with bated breath. We wait for years to be able to apply successfully for out own credit card. SuperCharged Secret 4, Credit Card Utopia YOU SCRATCH MY BACK, AND I'LL BUY SOME MORE BEER!Let's just take a brief moment to recap:If you've been following along on this journey with me, learning the 5 Super-Charged secrets to Credit Card Utopia, then you now know 3 very important things:You now know how to take advantage of zero to low interest credit card offers.You now know that there is safety in numbers, and you know the magic "Who's Who" of the major credit card companies. Tackling Bad Credit The first time I heard the term credit history was when I approached a lender for a secured loan. Being a first timer I was completely ignorant of the procedure and didn't even know that a credit record of our transactions is prepared by some credit reference agencies. Credit Card Balance Transfers Explained What is a balance transfer ?A balance transfer can be explained simply as a balance transfer! When a balance is transferred usually from a credit card, but possible from a bank account or loan to a credit card with a offer interest rate (usually 0%) for a set period. It does not have to be the entire amount. How did a Thief get my Name? Don't be a Victim of Identity Theft How do these people get my name? If you have a credit card, your name is sold to third parties, if you do not want this to happen, you must contact your credit card companies to inform them that you do not want your information sold. Check the privacy notice that comes with your bill. Credit Cards Can Help You Get Out Of Debt Your credit rating / credit score is based upon how you have dealt with credit previously.If you have always paid the full amount owing and never missed a payment then your credit score will be high. A Cure for an Ailing Credit Credit has become a much-used word, thanks to the various connotations that it is being used in. Transactions in which the payment is deferred to the near future are termed as credit transactions. Legislators Ponder New Credit Protection Laws Legislators in Washington, D.C. How Credit Scoring Works The all important credit score! It determines the amount of loan you can get, it determines the interest rate at which you are charged for a loan, etc. Your credit score plays an important figure in your financial life. |
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